Is this legal?

Comrade_salad

Hi, I was just wondering if a company pays cash in hand accompanied by a letter which reads the following:

"I confirm having received the amount as stated below in full and final payment for my services.

I confirm that I am not an employee of (company name) and accordingly, do not hold any employee rights or entitlements.

I am a self-employed individual and account for my own Income tax, Paye/Prsi and vat." With signatures or both payee and company.

Is a legally binding contract? Are the company breaking the law/ tax dodging or is this legal?

What would be the outcome of reporting a company who employs unvetted uninsured people to work with minors?

the_syco

Comrade_salad wrote: »

I confirm that I am not an employee of (company name) and accordingly, do not hold any employee rights or entitlements.

<snip>

What would be the outcome of reporting a company who employs unvetted uninsured people to work with minors?

Although they are not working for the company, am I right to assume that they still need to be vetted by the Gardai to work with minors?

Milk & Honey

A lot depends on what the actual re;lationship was. A person cannot claim to be self employed if in fact they are in reality an employee. the Department of Social Protection investigates these type of situations and often forces the employer to deduct paye/usc etc.

Comrade_salad

The person is not self employed and is, in reality, employed by company. Although there has never been any contract signed. Would the employer or employee be more likely to take a hit if this was reported?

Farcear

Comrade_salad wrote: »

The person is not self employed and is, in reality, employed by company. Although there has never been any contract signed. Would the employer or employee be more likely to take a hit if this was reported?

Both parties would be liable to pay the correct tax (plus, interest and penalties) for what they should have been paying as employee / employee.

I'd say the employer would be harder hit, as it would not be paying tax on anything. At least the employee was already paying tax through the self-assessment system.

Comrade_salad

The employee was not paying any tax.

the_syco

Comrade_salad wrote: »

The employee was not paying any tax.

Sounds like the employee may have led the company to believe that they were paying their own tax, but in fact were not.

Milk & Honey

It is illegal and the employer would be made to pay up. All Paye/USC as well as interest and penalties would be taken from the employer. I am aware of this happening.

Comrade_salad

the_syco wrote: »

Sounds like the employee may have led the company to believe that they were paying their own tax, but in fact were not.

No, the employer made the employee sign the document

MagicSean

Comrade_salad wrote: »

No, the employer made the employee sign the document

Did they put a gun to their head or something?

nuac

Look - the PAYE system is in here for over 50 years. All legit tax avoidance schemes have been tried.

This one wont work and will get both parties into trouble.

Dr Turk Turkelton

nuac wrote: »

Look - the PAYE system is in here for over 50 years. All legit tax avoidance schemes have been tried.

This one wont work and will get both parties into trouble.

Hmm not so sure about all legal tax avoidance schemes not being successful-what about C45's for construction workers during the boom?
These poor people didn't realise that they were in actual fact employees but the building contractors paid them with C45's to avoid PAYE,PRSI and pensions and other contributions.
Also when they were made redundant they were not eligible for social welfare as they had supposedly been self-employed.

aoshea83

I do know that certain cold calling point to point marketing companies, those guys who walk around selling crap from bags in businesses and the like around the country in places like Cork, not naming names or anything, work in this fashion, they have no employees, anyone selling their stuff is self employed and there is no contracts